Equities
Canada’s main stock index was treading water at Wednesday’s opening bell with weakness in tech and real estate stocks offsetting gains in energy. On Wall Street, key indexes slid at the start of trading as investors took a breather after the recent rally.
At 9:31 a.m. ET, the Toronto Stock Exchange’s S&P/TSX composite index was up 11.52 points, or 0.06 per cent, at 20,851.15.
In the U.S., the Dow Jones Industrial Average fell 37.79 points, or 0.10 per cent, at the open to 37,520.13.
The S&P 500 opened lower by 3.64 points, or 0.08 per cent, at 4,764.73, while the Nasdaq Composite dropped 29.86 points, or 0.20 per cent, to 14,973.36 at the opening bell.
On Wednesday, markets will get the minutes from the Bank of Canada’s policy meeting earlier this month, when it left interest rates unchanged. Traders will be watching for hints from the central bank about how long it intends to maintain rates at current levels, particularly after fresh figures this week showed the country’s annual rate of inflation held steady at 3.1 per cent in November. Economists had forecast an easing in price pressures.
“The release itself should have little surprises, with the on-hold announcement widely expected,” BMO economist Shelly Kaushik said.
“Still, we’ll keep an eye on any language on potential rate cuts given the market’s exuberant timing.
On the corporate side, markets will get results from BlackBerry after the close of trading. Earlier this month, BlackBerry Ltd. named John Giamatteo as its new chief executive and shelved a plan to spin off its Internet of Things business.
On Wall Street, shares of FedEx slumped more than 10 per cent in early trading after the company’s profit in its latest quarter fell short of analysts’ expectations. FedEx said adjusted earnings for the quarter that ended Nov. 30 jumped 23 per cent to US$1.01-billion, or US$3.99 per diluted share. But the result fell 19 US cents per share short of analysts’ estimate, according to LSEG data, Reuters reported. FedEx also cut its full-year revenue forecast. The results were released after Tuesday’s closing bell.
Overseas, the pan-European STOXX 600 rose 0.15 per cent in morning trading. Britain’s FTSE 100 added 0.94 per cent. Germany’s DAX and France’s CAC 40 added 0.08 per cent and 0.12 per cent, respectively.
In Asia, Japan’s Nikkei gained 1.37 per cent. Hong Kong’s Hang Seng added 0.66 per cent.
Commodities
Crude prices rose amid continued global trade concerns in the wake of recent attacks by Houthi militants in the Red Sea.
The day range on Brent was US$79.07 to US$80.07 in the early premarket period. The range on West Texas Intermediate was US$73.86 to US$74.87. Both benchmarks added about 1 per cent on Tuesday.
“In response to the disruptions in shipping at the Red Sea and despite ‘Operation Prosperity Guardian,’ a coalition to address security challenges in the Red Sea, oil prices were pushed higher on a combination of holiday hedges and goldilocks arriving at the oil patch,” Stephen Innes, managing partner with SPI Asset Management, said.
“As the holiday season draws near, achieving a stable outcome for the region appears elusive. The prolonged conflict in Gaza continues to fuel an escalating humanitarian crisis, adding political pressure on multiple actors.”
Later this morning, markets will get weekly inventory figures from the U.S. Energy Information Administration. Figures from the American Petroleum Institute released late Tuesday showed an increase in crude and fuel inventories. Analysts had been expecting a decline.
In other commodities, spot gold was steady at US$2,040.69 per ounce in the early premarket period. U.S. gold futures gained 0.1 per cent at US$2,053.90.
Currencies
The Canadian dollar was steady, trading around the 75-US-cent mark in the early premarket period, while its U.S. counterpart edged up against a group of currencies.
The day range on the loonie was 74.88 US cents to 75.04 US cents in the early premarket period. The Canadian dollar has gained more than 1 per cent against the U.S. dollar over the past five days.
“The CAD is holding little changed on the USD on the session,” Shaun Osborne, chief FX strategist with Scotiabank, said in a note.
“Yesterday’s higher than expected headline CPI data, and signs that core inflation remains sticky, underscores the outlook for steady policy in Canada for the moment, at least, and has backstopped domestic yields to some extent.”
On world markets, the U.S. dollar index, which weighs the greenback against a group of currencies, rose 0.08 per cent to 102.25.
The euro slid 0.21 per cent to US$1.0958 by early Wednesday morning.
Britain’s pound fell 0.59 per cent to US$1.2657. Figures released early this morning showed Britain’s annual rate of inflation fell to 3.9 per cent in November from 4.6 per cent a month earlier, helped by cheaper fuel costs.
In bonds, the yield on the U.S. 10-year note was lower at 3.894 per cent.
More company news
General Mills trimmed its annual sales forecast on Wednesday, hurt by slowing demand for its higher-priced breakfast cereals, snack bars and pet food products. The company forecast fiscal 2024 organic net sales between a decrease of 1% and flat, compared with its earlier forecast for growth of 3% to 4%. Analysts expected growth of 2.4%, according to LSEG data. -Reuters
Economic news
(8:30 a.m. ET) U.S. current account for Q3.
(10 a.m. ET) U.S. existing home sales for November.
(10 a.m. ET) U.S. Conference Board consumer confidence index for December.
(1:30 p.m. ET) Bank of Canada’s Summary of Deliberations for Dec. 6 policy decision.
With Reuters and The Canadian Press
Terry Weber